In the last few decades, harmful pollutants emitted from internal combustion engines fueled with mineral diesel and gasoline have gained significant attention from environmentalists and policymakers. Continuously decreasing conventional fuel reserves and emissions is a hot discussion point in the domain of energy transportation sectors. These issues have raised an immediate requirement for alternative fuels to be adopted in the transportation sector. Alcohols are the most suitable fuel to replace diesel and gasoline. Alcohol can be used as fuel commercially in automotive engines. Lower alcohol can be directly used in spark ignition (SI) engines. However, some engine modification is required for the application of alcohol in compression ignition (CI) engines. These alcohols constitute new combustion techniques and suppress harmful emissions. This article briefly explores the combustion, performance, and emission of alcohol-fuelled IC engines in the transport sector, as well as major issues. Combustion characterization includes in-cylinder pressure, heat release rate, knock characteristics, combustion chemistry, and combustion stability. Emission characteristics are reviewed, and insights into NOx and PM are emitted from alcohol-fuelled engines. Finally, different alcohol application strategies in SI and CI engines are discussed, highlighting the way forward technology for transport sector decarbonization.